After announcing to Bloomberg at the Players Technology Summit on Monday as Coinbase grew from a simple wallet to a true cryptocurrency platform, Coinbase CEO Brian Armstrong turned to the "future of cryptocurrency". Armstrong said that the economic crises that occur across the world in the next 3-5 years could be the catalyst for the organic adoption of cryptocurrencies.
"Countries going through the economic crisis and the pockets of people in those areas are becoming interested [in crypto] There is an interest among those people who have the highest sore point of having a stable currency […] In the next three to five years, countries experiencing the economic crisis could see people organically adopting the crypt as an alternative "
Armstrong's theory is evident in Turkey, since the recent unrest has brought citizens to seek financial shelter in bitcoins. While the economy suffered an adverse reaction to Trump's rates for Turkish steel and aluminum, the Lira crashed more than 20 percent within a few hours. This pushed investors not into the traditional gold refuge, but in bitcoin
Koinim, Turkey's largest exchange, reported an increase of 63 percent in the volume of the Bitcoin exchanges, and the BTCTurk and Paribu exchanges have seen volume increases of 35% and 100% respectively. This pushed the price of bitcoins into Turkey up to $ 7,000 – over $ 500 higher than the Brave New Coin Bitcoin Liquid Index which is based on most of the global trading activity.
Although bitcoin may not act as a means of daily exchange, Turkish citizens flock to it as a safe haven a way to escape the fluctuations of the Turkish Lira against the dollar, which make also the fluctuations of the calm bitcoin.
Fertile ground for adoption
As Armstrong acknowledged in his interview, from the point of view of the average American citizen, the current financial system works quite well. Although cryptocurrency offers some advantages over traditional payment systems, to recognize them must often be seen in a different light.
As a payment system, cryptocurrency shows its true potential when it is seen against systems that are falling apart – crumbling economies and devaluing currencies. These conditions highlight the advantages of a less prone to inflation and manipulation reserve and give traders and customers a concrete reason to make the switch.
According to Armstrong, only 10% of the use of cryptocurrency is transactions, with the other 90 percent being the speculative activity of traders and investors. Some countries that face political and economic unrest, however, tell a very different story.
The most obvious example is Venezuela, where cryptocurrency has helped to save citizens from a sharp decline in purchasing power due to hyperinflation, but in recent years numerous crises have been correlated with the increase in bitcoin demand. This includes the ongoing economic uncertainty in the African countries of Sudan, Kenya and South Africa and countries facing economic sanctions such as Iran.
Establishing a causal relationship between these economic crises and the adoption of cryptocurrency is not easy, but events continue to suggest that bitcoin is becoming a viable financial alternative.
The bitcoin project
Armstrong, who started a non-profit organization ]
author of Antonopolo For some time he suggested that, given a sufficient development of awareness and infrastructural systems, user interfaces, ramps and ramps , the crypt could open an emergency exit door for those who face the economic crisis:
"Until now, getting out of a country meant physically removing: refugees, escape, and this creates its dangers: exploitation human despair, catastrophe, tragedy But one of the interesting things that happens with cryptocurrency is your ability to stay, stay in place and go out economically without leaving the country, keep trading with your neighbors, engage in trading with other people; come out of the currency only and stay where you are. "
Meanwhile, in traditional markets, the gold shelter remains stuck in a downtrend of three months, prompting some commentators to suggest that the bitcoin is pawing the dominance of gold: